There’s an IPO Bonanza Next Week

With Silicon Valley’s tech workers stuck inside amid the dueling crises of the coronavirus pandemic and raging wildfires across California, the industry is simultaneously gearing up for one of its busiest IPO weeks of the year…

The biggest names poised to hit the market next week are cloud database vendor Snowflake and gaming technology company Unity Software. They’ll be joined by several other enterprise software companies, as well as Amwell, a telehealth provider based in Boston.

Lise Buyer, founder of tech IPO advisory firm Class V Group, said that a bunch of companies that had originally been aiming to debut in April or May put their plans on hold when Covid-19 became the dominant economic story.

With the market bouncing back and tech stocks soaring in recent months, some of those companies restarted their prep work to shoot for the post-Labor Day window, which is often a busy period for IPOs as bankers and investors return from summer vacation.

“They reignited their engines,” said Buyer, who worked on Google’s IPO in 2004.

Buyer described the coming deluge as “back-to-school week for IPOs” and said the switch to online investor meetings sped things up by a week or two, because companies could cram many more sessions into a single day and meet potential shareholders in parts of the country they would normally skip.

“Roadshows are both shorter and more thorough now because companies can speak with more investors in a condensed period of time,” Buyer said.

Going public sooner is more important in 2020 than in most years because investor attention is soon expected to turn to the presidential election, which is less than two months away.

But in their haste to sell shares, tech companies could find themselves bumping up against shifting market conditions. Since reaching a record on Sept. 2, the Nasdaq has dropped more than 9% as of Thursday’s close, and is headed for its worst two-week drop since March.

“Volatility is always a concern,” Buyer said. “But these offerings will succeed or fail based on fundamentals and their business prospects.”

Snowflake is set to be the most valuable of the new IPOs out of the gate. The company, whose data warehouse software helps companies manage and share vast amounts of information in the cloud, would be worth about…

Continue reading at CNBC.COM


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